Serbia Inks Three-Year Gas Deal With Russia

While the European Union is scrambling to find ways to import less gas from Russia, Serbia has bucked the trend, with President Alexander Vucic announcing today a new three-year gas import deal with Gazprom.

"What I can tell you is that we have agreed on the main elements that are very favourable for Serbia," Vucic told media following a phone conversation with his Russian counterpart Vladimir Putin.

"We agreed to sign a three-year contract, which is the first element of the contract that suits the Serbian side very well," Vucic also said.

Amid the EU's increasingly aggressive position on Russia since the invasion of Ukraine, with five packages of sanctions already agreed upon and a sixth one on the way, Serbia has remained a staunch supporter of Moscow.

The Associated Press noted in a report on the news that it remained unclear how Serbia would receive the gas if the European Union decided to stop the flow of Russian gas across all of its member states.

However, such a move is quite unlikely for the time being as the EU remains highly dependent on Russian gas imports as it seeks to fill up its storage caverns ahead of the next heating season, and LNG would not be enough to do that.

Currently, Serbia receives Russian gas via a pipeline that goes through Bulgaria. Gazprom suspended shipments to Bulgaria itself in late April after Sofia refused to pay for the gas in rubles. At the time, the Russian side made a note of warning that if Bulgaria tried to steal gas going to Serbia, it would have to pay for it.

Serbia is in the process of negotiating an EU membership, but at the same time, it has forged closer ties with Russia over the past few years, which has not pleased Brussels.

By Irina Slav for Oilprice.com

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